African Journal of Estate and Property Management

African Journal of Estate and Property Management ISSN 9671-8498 Vol. 4 (3), pp. 001-005, March, 2017. © International Scholars Journals

Full Length Research Paper

The SEEDS of oil price fluctuations: A management perspective

Shih-Chi Chang

Department of Business Administration, National Changhua University of Education, No. 1, Jin-De Road, Changhua City 500, Taiwan. E-mail: [email protected]. Tel: 886-4-7232105 ext. 7416 Fax: 886-4-7211292.

Accepted 16 October, 2016

Abstract

In view of unreasonable oil price fluctuations, this paper reviews past researches to propose a SEEDS framework to analyze the forces that influence oil price fluctuations. The SEEDS framework discusses oil price fluctuations from the supply side, environmental protection side, economic side, demand side and substitute side. According to SEEDS, we believe the rapid increase in oil price is not good for both net oil exporters and net oil importers. Of course, nobody doubts that crude oil reserves are limited. We also believe that oil prices would continuously increase, but not double or triple within one year. The global economy cannot endure sharp increase in manufacturing costs and product prices. This would reduce consumption and production at the same time, followed shortly by financial market crisis. Recognizing the symbiosis of net oil exporters and net oil importers is very important; we believe that this framework will help people understand that rapid increases in oil price are dangerous to world economics. The SEEDS framework can also be applied to analyze the price fluctuations of bulk commodities.